Business classification of factoring business, popular explanation of factoring business

In practice, there are many different ways of operation in factoring business. Generally, it can be divided into: factoring with recourse and without recourse; explicit factoring and implicit factoring; Discount factoring and expiration factoring.

Recourse factoring.

Factoring with recourse means that the merchant transfers the creditor's rights of the accounts receivable to the bank (i.e., the factor), and after the merchant receives the payment, if the buyer refuses to pay or is unable to pay, the factor has the right to seek recourse from the merchant to repay the prepaid monetary funds. At present, out of prudence, banks usually provide customers with recourse factoring in order to reduce possible losses in the future.

Non-recourse factoring.

Non-recourse factoring, on the other hand, bears the risk of the purchaser's refusal or inability to pay. **After the business has carried out factoring business with the factor, it is equivalent to transferring all the risks to the bank. Banks generally do not accept it because of the excessive risk.

Ming factoring. Explicit factoring and implicit factoring are distinguished by whether or not the factoring business is notified to the purchaser.

Explicit factoring means that the supplier should immediately inform the buyer of the factoring situation when the creditor's rights are transferred, and instruct the buyer to pay the purchase price directly to the factor.

At present, the factoring business carried out by domestic banks is explicit factoring.

Dark factoring. Dark factoring excludes the purchaser from the factoring business, and the bank and the supplier carry out the factoring business separately, and the supplier comes forward to collect the payment after the expiration, and then hands it over to the factor after recovery. Suppliers can conceal their poor financial situation by carrying out dark factoring.

It should be noted that there are clear provisions in China's Contract Law that when a merchant transfers its own accounts receivable, it must be agreed in the purchase and sale contract and the buyer must be notified.

Discount factoring. Discount factoring, also known as financing factoring, means that when the exporter hands over the bill representing the accounts receivable to the factor, the factor immediately provides the exporter with financing of no more than 80% of the accounts receivable in advance payment, and the remaining 20% of the accounts receivable will be liquidated after the factor collects all the payment from the debtor (importer). This is a typical factoring method.

Expiration factoring. Factoring at maturity means that the factor does not provide financing to the exporter when it receives the sales invoice and other documents submitted by the exporter on behalf of the accounts receivable, but pays the seller after the documents are due. Regardless of whether the payment can be received by then, the factor must pay for the goods.

Domestic factoring: a comprehensive financial service.

Factoring. It refers to a contractual relationship between the seller, the merchant or the exporter and the factor, according to which the seller, the merchant or the exporter transfers the accounts receivable arising from the contract of sale of goods or services concluded between the seller and the buyer (debtor) to the factor, and the factor provides the borrower with financing, sales account management and accounts receivable.

at least two of the services of collection, credit risk control and bad debt guarantee.

The factor is based on the factoring contract.

Specializing in the provision of credit and credit management services to the relevant commercial enterprises, modern factoring has been able to provide a package of services, including buyer's credit investigation to sellers, 100% loan commercial risk guarantee, accounts receivable management and financing.

The official website shall prevail.

Factoring is also known as factoring**.

Guaranteed collection is a practice adopted by the exporter to ask a third party (factor) to bear the risk in order to avoid the risk of collection when settling the loan by way of collection and credit sales. Factoring.

It is a collection of financing, commercial credit investigation, accounts receivable.

Comprehensive financial services integrating management and credit risk-taking. Compared with traditional settlement methods, the advantage of factoring is mainly in the financing function. The factor provides at least two of the following services:

**Financing. According to the seller's capital needs, the factor can provide financing to the seller as soon as it receives the transferred accounts receivable and assist the seller in solving the working capital.

Shortage issues. Sales sub-account management.

According to the requirements of the seller, the factor can regularly submit to the seller the status of accounts receivable, overdue accounts, aging analysis, etc., and send various statements to assist the seller in sales management.

Collection of accounts receivable.

The factor has professionals engaged in collection, and they will take reasonable, forceful and restrained measures according to the overdue time of the accounts receivable to assist the seller in the safety of the account.

Credit risk control and bad debt guarantees.

The factor can approve the credit limit for the buyer according to the seller's needs, and the factor provides a 100% bad debt guarantee for the accounts receivable arising from the seller's delivery within the credit limit.

In layman's terms, factoring is to guarantee **, **guarantee to pay you. Company A and Company B**, Company A sells goods, and Company B pays money. The bank signs a factoring agreement with Company A, Company A delivers the goods, the bank provides factoring financing to Company A, and the accounts receivable are counted as the bank, and the bank asks Company B to collect the payment.

Factoring, also known as factoring, is a comprehensive financial service method in which the seller transfers its current or future accounts receivable arising from the contract for the sale of goods with the buyer to the factor, and the factor provides it with a series of services such as financing and sales account management.

Factoring is a comprehensive financial service that integrates financing, accounts receivable collection, management and bad debt guarantee on the premise of creditors transferring their accounts receivable. The creditor assigns its receivables to the bank, whether financed or not, and the bank provides it with at least one of the following services: receivables collection, receivables management, bad debt guarantee.

Extended Information: How International Factoring Works:

1. Single factoring.

The single factoring method is applicable to countries and regions where the exporter is located and there is no factor. This type of factoring should be referred to as "direct factoring", which is much more risky because it only involves the import or export factor, and lacks the cooperation of the other factor.

2. Double factoring.

The dual factoring method is applicable in countries and regions where both the importer and exporter are located in countries and regions where there are factors. The exporter signs a factoring contract with the export factor in its own country, and then negotiates the sales contract with the importer and agrees to adopt the factoring settlement method.

As long as the importer pays the payment in time according to the original contract, the factoring business is completed. The importer's credit limit is recyclable for the period specified in the factoring contract.

Domestic factoring: a comprehensive financial service.

Factoring. Also known as:Collection Guarantee, the seller will be based on its present or future contract for the sale of goods and services with the buyerAccounts receivableTransfer to a factor (a financial institution that provides factoring services), and the factor will provide it with financing, buyer's credit evaluation, and sales account managementCredit RiskA comprehensive financial service method with a series of services such as guarantee, account collection, and high slag.

It is a practice of entrusting a third party (Zu Nianqing factor) to manage accounts receivable when the seller settles the payment by collection and credit in the commercial ** in order to strengthen the management of accounts receivable and enhance liquidity.

Factoring Business Advantages:

For suppliers, first of all, it can provide more competitive payment terms for the company's customers, which not only maintains a good customer relationship, but also ensures the timely return of funds, accelerates the circulation of funds, and increases the profits of the enterprise.

Secondly, after the factoring business is carried out, the bank can collect the accounts and control the credit risk, which transfers the risk to the bank to a certain extent. In addition, compared with the cumbersome L/C transaction, the procedures for factoring business are relatively simple.

For the buyer, because the bank provides the supplier with early capital facilities, the supplier can give the buyer more favorable payment terms, which is conducive to the expansion of the buyer's business and the increase of profits.

1. A factoring company is a financial institution that provides factoring services.

Business scope of factoring company: factoring business.

It is a set of ** financing.

Commercial credit investigation, accounts receivable management and credit risk.

Undertake comprehensive financial services in one.

An insurance company is an insurance company in accordance with the Insurance Act and the Companies Act.

A corporate legal person established by the company. The insurance company collects the premium, invests the capital obtained from the premium in assets such as bonds, **, loans, etc., and uses the income from these assets to pay the insurance compensation determined by the policy.

Through the above-mentioned business, insurance companies are able to make a profit by obtaining high returns on their investments and providing appropriate insurance services to their customers at lower premiums.

Extended information: An insurance company is an insurer that adopts the form of a company organization and operates insurance business. The insurer in the insurance relationship has the right to collect insurance premiums and establish insurance premiums.

At the same time, when an insured event occurs, there is an obligation to compensate the insured for financial losses.

An insurance company is a company that sells insurance contracts and provides risk protection. An insurance company is an economic organization that operates the insurance industry. Insurance companies refer to commercial insurance companies established with the approval of the China Insurance Regulatory Authority and registered in accordance with the law, including direct insurance companies and reinsurance companies.

Joint-stock insurance companies.

A joint-stock insurance company is similar to a joint-stock company in other industries, and is established by the promoters in accordance with the Company Law, which specifies the number of promoters of the company, the limit of the company's debts, the types of credit to be issued, taxes, business scope, the company's powers, application procedures, company licenses, etc. Western developed countries.

The company's organization is made up of three power groups, namely shareholders, the board of directors, and senior managers.

Mutual insurance companies.

A mutual insurance company is also a form of corporate organization, but it is a non-profit corporation that has no shareholders and the company is owned by the policyholder (policyholder). Therefore, the policyholder has a dual identity, being both the owner of the company and the customer of the company. The shareholders of a joint-stock insurance company are not necessarily the customers of the company, and the policyholders of the mutual company, as the owners, may participate in the election of the board of directors, and the board of directors appoints the senior management of the company.

Specializing in the business operation and management of the company. The policyholder can obtain"Bonus"The form of sharing business into Tanwu fruit.

Captive insurance company.

Note for factoring companies:

1. The buyer (importer) must have a good reputation or credit, so that the import factor can approve a certain credit limit for it, otherwise it is impossible to be accepted.

2. Before continuing the factoring business, a lot of work such as application, credit assessment, and credit limit verification should be done in the formal signing of the export contract.

3. Only when the export factor agrees with the exporter to do the factoring business, that is, after the export factor has approved the credit limit for the importer, can the foreign trade contract or shipment of goods be formally signed.

4. Pay attention to the use of the importer's credit line (balance status) and changes in its credit status. Maintain effective communication with export factors at all times.

The factoring business is divided into international factoring and domestic factoring, of which domestic factoring is developed from international factoring. International factoring is also known as international payment factoring or factoring**. It refers to the comprehensive financial service business in which the factor provides credit insurance or bad debt guarantee to the exporter through the acquisition of creditor's rights, the collection or management of accounts receivable, and the financing of at least two businesses, and its core content is to provide export financing through the acquisition of creditor's rights.

Different from international factoring, the factor, the applicant for factoring, and the buyer of commercial contracts in domestic factoring are all domestic institutions.

What does factoring include:

1. Accounts receivable collection: According to the accounts receivable account period, commercial banks take the initiative or at the request of creditors to collect debtors by means of **, letters, door-to-door visits or legal means.

2. Accounts receivable management: According to the requirements of creditors, commercial banks regularly or irregularly provide them with financial and statistical statements such as accounts receivable, overdue accounts, chain answers, etc., to assist them in accounts receivable management.

3. Bad debt guarantee: After signing a factoring agreement with the creditor, the commercial bank shall verify the credit limit for the debtor, and provide the agreed payment guarantee for the accounts receivable without commercial disputes of the creditor within the approved limit.

4. Factoring financing: bank financing services based on the premise of legal and effective transfer of accounts receivable.

Knowledge Expansion:

Classification of factoring business

1. Recourse (repurchase) factoring means that the seller transfers the accounts receivable claims that meet the conditions agreed in the factoring agreement and are approved by the bank to the bank, and when the accounts receivable claims cannot be fully agreed as scheduled, the seller is responsible for repurchasing the accounts receivable or returning the financing, and the bank has the right of recourse against the seller.

2. Non-recourse (non-repo) factoring means that the seller sells the accounts receivable claims that meet the conditions agreed in the factoring agreement and are approved by the bank to the bank to obtain services such as commercial credit investigation, financing, sales ledger management, accounts receivable collection, and credit risk guarantee.

In the absence of commercial disputes, if the buyer is unable to fulfill the payment obligation due to financial or credit reasons, the bank must pay the full factoring amount to the seller according to the factoring amount confirmed by the buyer. If the bank has provided financing under factoring to the seller, the bank has no right to recover the financing from the seller, and the commercial bank shall bear the risk of bad debts of the accounts receivable.

3. Public factoring (explicit factoring) refers to the fact that the buyer is notified of the transfer of the creditor's rights at the same time as the accounts receivable claim is transferred from the seller to the bank, and the payment for the goods is written on the bill.

4. Concealed factoring (dark factoring) refers to the fact that the buyer is not notified of the transfer of creditor's rights, and the payment is collected according to the general procedure, and the bill is not written on the bill to be undertaken by the bank, and the name of the factoring bank is not highlighted.